Defense Drives Surge in Space Investments

The commercial space industry attracted US$ 5.8 billion across 115 companies in the third quarter of 2025, putting the year on track to be among the top three funding years in history, according to the latest quarterly report from Space Capital.

Source: www.exterrajsc.com

The report noted that NASA faces budget constraints, with the U.S. government proposing cuts while Congress works to keep funding close to US$ 25 billion. This is driving defense spending to become the primary driver of investment, with the U.S. Space Force potentially receiving US$ 40 billion in fiscal year 2026, representing a 40% increase over the previous year.

In the third quarter, US$ 5.8 billion was invested across 115 space companies. This demonstrates that 2025 is already ahead of 2024 and on track to be one of the top three funding years for investments in the space economy. Therefore, there has been a significant recovery in recent years. Venture capital funds drove much of this investment, with 86% allocated to infrastructure, totaling approximately US$ 4.4 billion. This represents a 12% increase compared to the previous quarter.

Satellite manufacturing and defense capabilities were the main beneficiaries of these resources, with the Golden Dome program being a key component, even though its true scope is still unknown. Companies seeking investment are placing significant emphasis on the Golden Dome program.

Investment in geospatial intelligence applications (GEOINT) jumped from US$ 1 billion in 2020 to a record US$ 21.6 billion in the third quarter of 2025. For example, Google launched the AlphaEarth Foundation during the quarter, creating a planet-scale AI model from satellite and aerial data, and several companies are poised to capitalize on this shift.

The report also highlighted that SpaceX maintained its position as the world's most valuable private company, with a valuation of US$ 400 billion, despite political uncertainty. It also noted that in the infrastructure sector, satellite manufacturing showed steady momentum. The report tracked the cumulative private capital investment of US$ 393 billion in 2,286 different companies since 2009.

(Text adapted from an article by Tom Patton, published in The Journal of Space Commerce, available at www.exterrajsc.com)